Lombardo described the need to form the provision as “disappointing for the UK government” but said Lendlease had taken out insurance and was confident it would be able to cut costs when the time came.
“It’s disappointing when the government introduces retrospective legislation and it’s changed the game…some of what we’re being asked to remedy actually pre-acquires the portfolio when it was actually under construction,” Lombardo said.
“We expect that any cash expenditure related to this provision will be spread over a period of at least five years. This estimate is before any expected third party recoveries, including insurance and supply chain.”
Lendlease operates in three main areas: investment, development and construction.
Sequoia Asset Management’s Winston Sammut said hopes for support for the share price rested on an overall improvement in the current second half.
“Although the forecast for 2023 is confirmed, it is at the lower end of expectations. While overall net income after tax was slightly below consensus, it was helped by the $78 million one-time gain from the partial sale of US military housing coupled with lower costs,” Sammut said.
Lendease’s construction fell about 20 percent year-over-year due to supply chain issues, high shipping costs and labor shortages.
Lombardo took the helm at Lendlease in June 2021 at the start of the global pandemic and reviewed the deal with the goal of simplifying the structure and reducing costs.
He said at the earnings briefing that he wants to derive between 40 and 60 percent of revenue from Australian operations and increase the number of equity partners across the global business.
The group reported an interim dividend of 4.9 cents, payable February 17.
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https://www.smh.com.au/business/companies/lendlease-looks-to-partner-deals-to-boost-funds-management-to-70b-20230213-p5ck1j.html?ref=rss&utm_medium=rss&utm_source=rss_business Lendlease seeks partner deals to increase fund management to $70 billion